The real estate market is characterized by numerous inefficiencies that create problems for consumers, agents, and vendors.
Consumers suffer from a lack of real estate information and tools. Although many real estate brokerages provide visibility into property listing information on their web sites, these tools remain surprisingly poor. Overall, brokerages and other online real estate companies have introduced online technology that perpetuates the agent's role as an information source, rather than embracing the reality that the agent's role is shifting to that of information interpreter, with a value proposition more oriented around experience, knowledge, and wisdom.
Residential real estate agents also suffer from numerous problems at present. First among these is competition for consumers. High commissions and low barriers to entry have caused the agent ranks to grow far more quickly than transaction volume, intensifying competition. Second, agents have a very difficult time marketing themselves. Brokerages typically do not promote one agent over another and thus expect agents to market themselves individually. This is costly and inefficient. Lastly, agents suffer from a lack of collaborative tools.
To stay competitive, agents increasingly turn to third-party lead sources. Several companies have met this demand by capturing customer information online and reselling it as “leads” to interested agents. Agents encounter several problems during this process. First, the leads may be very poorly qualified. Depending on how the lead seller induces customers to provide their contact information, the “leads” may comprise people that simply are curious to know the value of their house, for example. Second, the agent must expend significant time and effort to move the leads through a sales process. Third, leads purchasing is generally costly.
Vendors, or real estate service providers, can include mortgage lenders, appraisers, inspectors, title companies, escrow companies, insurers, contractors, moving companies, and other providers whose services relate to property transactions. Because each of their services is typically demanded in a property transaction, these vendors derive considerable business from informal professional networks. At present there is no mechanism that allows consumers to evaluate the value of a given network or to perceive it as an entity that has intrinsic value. It is very difficult, for instance, for an agent to market his or her “team” of linked professionals, and to derive additional business from the strength of the team.
There is a need for a system that overcomes limitations of the current real estate system, as well as providing additional benefits.